Plan Early for Your Child’s Long-Term Security
The vast majority of my clients who have children with special needs share the same goal: that they will outlive their children. The thought of leaving their loved ones behind is, at the very least, traumatic. Special needs planning can help pave the road to a more hopeful future. There are several common issues for people to consider as they develop a plan to care for their loved ones.
Transition Planning involves helping a young person prepare for adulthood. This planning is important because when a person reaches the age of majority (which is 18 years of age in many jurisdictions), many different rules may apply. For example, a parent might no longer have legal standing to act on behalf of a child for educational or medical purposes once the child turns 18.
A caregiver should ideally begin transition planning when the care recipient is about the age of 15, and should ensure that the student’s Individualized Education Plan (IEP) prepares them for life after graduation. The planning should involve as much input from the care recipient as possible in order to reflect their preferences for future living arrangements, career and social life. The IEP should be designed to provide the academic, social and life skills they’ll need to achieve their goals, given a support system that will change dramatically once they leave high school.
In many cases, establishing powers of attorney that cover legal, financial, educational and healthcare decisions can provide the right balance of independence and security for a young adult. A power of attorney can be dissolved at any time and merely adds a decision maker to the individual’s support team. It may make sense for more than one person to fill these various roles, depending on their skills and relationship with the individual. For those with more severe disabilities, a guardianship and/or conservatorship, which grants more far-reaching authority, should be explored. These are serious decisions, and a special needs attorney should be consulted.
For many, special public educational programs will terminate in early adulthood. Some individuals will pursue further education and others will enter the workplace. Others may need specialized day programs and services. Having a plan designed to Obtain or maintain meaningful activity can help instill a sense of pride and self-satisfaction for both parents and adult children. A state’s Vocational Rehabilitation Agency may be helpful in providing job coaching and other supports. Job coaches provide a wide range of services, such as identifying an individual’s capabilities, preparing them for interviews and providing onsite employment support.
One of the most important considerations in special needs planning revolves around making appropriate provisions for where a child will live. Some individuals can live comfortably in the community with proper supports, while others may need a higher level of care in a professional setting. Identifying the proper setting and taking the appropriate steps to secure the setting can alleviate a lot of anxiety. The residential landscape is complicated, and much research is required. Parents may need to consider when an individual should move from the family home, what supports will be necessary and what can be afforded. What sort of social life do they want? There are long waiting lists for the group homes covered by Medicaid waiver programs, and other options can be costly. Some families choose to share the expense of housing several compatible roommates who need similar levels of direct support. Suffice it to say that professional assistance may be required.
Estate Planning and Public Benefits
Parents are frequently justified in being concerned about their child’s long-term economic security. Government programs such as Medicaid and Supplemental Security Income (SSI) are often key, but they leave many needs unmet. While parents may be tempted to bequeath funds to a child with disabilities, having more than $2,000 in assets disqualifies an individual for means-tested public programs. Creating a special needs trust (SNT), avoids that problem, since the funds held in such trusts are not counted when determining someone’s eligibility. The beneficiary does not have direct access to the funds, which are administered at the sole discretion of a designated trustee, and distributions are carefully monitored. There are different types of special needs trusts, and it would be important to consider the best way to use the right type of trust for the beneficiary’s needs.
A first party SNT is funded with assets belonging to the beneficiary, such as an inheritance or personal injury settlement. A third party SNT is funded with assets coming from other sources, such as a parent, grandparent or friend. And a pooled trust, which may be either a first or third party trust, is an option often chosen for relatively small trusts, combining the assets held in many sub-accounts in order to facilitate investment and administration. These are complex documents, so families should seek counsel from an attorney experienced in handling them.
Some attorneys advise that an SNT be accompanied by a letter of intent that helps to guide the trustee in administering funds according to the wishes of the person who created it. Such a document might, for instance, outline a parent’s hopes that a child with special needs will obtain post-high school training, in which case the trustee would be encouraged to expend resources with that aim in mind. Or a parent might indicate that having a service dog has been of great benefit to the individual, so that a trustee would understand that paying for related expenses would be in keeping with the parent’s philosophy.
Establishing an ABLE account is another way to save funds while protecting benefit eligibility. Most state governments are still in the process of implementing ABLE programs, based on federal legislation passed in late 2014. A handful of programs are currently available and most of them welcome out-of-state applicants. ABLE accounts can be funded from any source but have more restrictions on balances and distributions than SNTs. On the other hand, the beneficiary can directly access ABLE account funds at any time.
There’s a lot to consider when planning for the long-term well-being of a loved one with disabilities, and I encourage families to seek advice. They should talk to other parents, care managers, advocacy groups and attorneys who practice in the area of special needs planning to get a variety of perspectives. Beginning those conversations early will prepare them to thoroughly explore alternatives and better enable them to empower their child to lead a life characterized by independence and dignity.
Scott C. Suzuki, Esq., is the immediate past president of the Special Needs Alliance (SNA®), a national nonprofit of attorneys committed to assisting individuals with disabilities, their families and the professionals who serve them.
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This post originally appeared on our January/February 2017 Magazine